Student debt in our country is now more than car loans or credit card debt. Under current law, student loans are one of the very few types of debt that can’t be discharged, even in bankruptcy court.
On the other side of these cold, hard facts is the psychological toll debt can take. The greater the financial strain, the more likely you are to experience symptoms of depression, anxiety and overall ill-health that can leave you feeling distracted at work.
If you’re one of the millions saddled with student loans or any other type of debt, you’ve probably experienced feelings of hopelessness. You might feel as though you can’t leave a high-paying yet toxic job that pays well. Maybe you’ve feared making life decisions like starting a family or buying a house, all because you need to make payments. You might be running yourself into the ground working multiple gigs and side hustles just to make ends meet.
Some studies have even found the mental stress of debt closely mirrors the stages of grief.
- In the denial stage, you want nothing more than to bury your head in the sand and pretend your student loans don’t exist.
- Next might come anger, however irrational. You might feel angry at your school, your lender, society and even yourself for taking out these loans in the first place.
- You might experience feelings of bargaining, promising yourself you’ll never take out a loan ever again. If only you could win the lottery so you could just quit working, period.
- Then comes depression, that feeling of pure defeat. I’ll never get out of debt anyway, you tell yourself, so what’s the point? Why even keep working hard at my job if the money I make just goes straight to paying back my debt?
Here are five constructive ways to deal with the effects of student loan stress.
1. Get to the root of your money shame–and let it go.
Many times, strong feelings about money are rooted in something much deeper, sometimes stemming from your childhood. For instance, are you angry at your parents for pushing you into a career path that, while high-paying, isn’t your calling? Maybe you wanted to go into social work, but your parents pushed you to be a doctor or lawyer. Maybe they put pressure on you to attend an Ivy League school and you had to borrow heavily to make it happen.
It’s worth doing the work to examine the feelings and reactions that are fueling your stress and behavior (avoidance, overspending, or something else) so you can regain control and start to untangle yourself from the emotional mess of debt.
2. Own your choices.
If this piece of advice sounds like tough love, well, it is. You have the option of mentally owning your choice and saying to yourself, “I’m proud that I’m taking responsibility for my actions.” It’s a great example of how cognitive reappraisal and a growth mindset can have a powerful effect, motivating you to take action instead of wallowing.
3. Create order out of chaos to feel more in control.
Money shame leads to avoidance. That might mean never looking at your loans or bothering to understand your interest rates, options for repayment or how to go about consolidating. You might have no idea what you owe in total of student loans because you’ve chosen to bury your head in the sand (remember the denial stage of grief?).
In reality, information can actually be a stress reliever because it puts the worst-case scenario that’s keeping you up at night into perspective. It robs worry of its power over you.
For example, I had a client who had a bad performance review. This concern began spiraling out of control. Fear of losing her job morphed into ending up on the street, completely unable to pay back her $80,000 in loans. When I had her take one step to gather information about her financial situation it made all the difference. For you that may mean simply making a call to your loan service when you never have before. Or creating a spreadsheet of the interest rates for your different loans across providers.
Outer order can create inner peace. It helps make sense of chaos.
4. Move away from the tunnel vision of a scarcity mindset so you can identify opportunities to make more money.
When you’re worried about money and feel your options are limited, that fear response acts like cognitive blinders. You start assessing situations in a protective way, missing opportunities or chances right in front you.
Let’s say you decide to put even more effort into saving and cutting corners. Especially if you’re already astute about your finances and scrambling to do everything you can, asking yourself to be even more stringent with your money can feel impossible or may even backfire. You may find yourself thinking things like, “I worked hard! I deserve this fancy dinner!”
The shift here is to move away from the “tunnel vision” of a scarcity mindset and scan for opportunities to make more. For example, if you’ve been at a job for a while, consider approaching your boss for a raise. Or you might renegotiate an agreement with a freelance client based on the stellar results you’ve been getting them. Earn more, then sock all the extra cash away to your loans.
Feeling like you’re pushing yourself to grow professionally and making inroads with your loans? That’ a win-win.
5. Prioritize your financial well-being.
When you act out of fear, desperation and shame, you’re more likely to make unwise choices. Putting yourself in a place of psychological safety, then, is inherent to your success. It may mean sacrificing work happy hours (and the $100 bar tab from buying a round for your co-workers) in favor of playing a longer-term game or taking a job that pays better for a little while rather than one that makes your heart sing, even if just for a little while.
Yes, the FOMO may be tough to deal with, but ultimately financial safety is a pillar of Maslow’s hierarchy of human needs. It’s the foundation you need to be happy and it also allows you to make better financial choices.
Much of managing the profound stress of student debt is a mental exercise. Your student debt might feel big or small at different times in your life. In your twenties, college debt can seem completely overwhelming, but the earning power you might have in your forties can make that debt seem much more manageable.
Commit to stop obsessing over numbers, take control of the things you can change and don’t wait until your debt is repaid to enjoy your life